A Trade Connections Protection clause within a force-majeure context is unusual and potentially problematic, as it appears to conflate two distinct contract concepts. Force-majeure clauses typically excuse performance when unforeseeable, extraordinary events (acts of God, war, pandemics) make performance impossible or impracticable. A "Trade Connections Protection" element in this context would likely attempt to protect a party's business relationships or supply chain connections from being disrupted or reassigned due to force-majeure events. This might mean that if a force-majeure event prevents one party from performing, the other party cannot use that event as justification to establish alternative trade connections or relationships that would circumvent the original contract.
This clause is problematic because it attempts to limit a party's reasonable mitigation efforts during extraordinary circumstances. Standard contract law and force-majeure principles generally allow parties to take reasonable steps to mitigate damages when performance becomes impossible—including establishing alternative suppliers or business relationships. A clause that prevents this could be viewed as unreasonable and potentially unenforceable, as it would require a party to suffer damages without attempting to minimize them.
If you encounter a force-majeure clause with trade connections protection language, seek immediate clarification on what it actually prohibits. Avoid agreeing to language that prevents you from establishing alternative business relationships during genuine force-majeure events, as this could expose you to significant liability without offsetting benefits. If you are drafting such a clause, reconsider whether it serves a legitimate purpose—instead, use standard force-majeure language combined with separate non-solicitation or exclusivity provisions if you wish to protect trade relationships. Ensure any restrictions on alternative arrangements are limited to the duration of the force-majeure event and apply only to relationships that directly compete with the original contract.
Frequently Asked Questions
What does this clause mean in simple terms?
A Trade Connections Protection clause within a force-majeure context is unusual and potentially problematic, as it appears to conflate two distinct contract concepts.
Why should I care about this clause?
Force-majeure clauses typically excuse performance when unforeseeable, extraordinary events (acts of God, war, pandemics) make performance impossible or impracticable.
What are my options?
A "Trade Connections Protection" element in this context would likely attempt to protect a party's business relationships or supply chain connections from being disrupted or reassigned due to force-majeure events.
How does this affect small businesses?
This might mean that if a force-majeure event prevents one party from performing, the other party cannot use that event as justification to establish alternative trade connections or relationships that would circumvent the original contract.